Global Trade, Tariffs, AI Investments, Nicotine Pouches, and More

In this podcast, Motley Fool analyst Asit Sharma and host Dylan Lewis discuss:

• The Trump administration's plans for tariffs on imports from Canada, Mexico, and China, and the de minimus exemption on imports below $800.
• How businesses like cross-border railroad Canadian Pacific Kansas City are responding to tariffs potentially affecting the flow and volume of goods.
• OpenAI and Softbank's latest set of announcements -- a $3 billion enterprise contract and joint venture to bring artificial intelligence offerings to Japanese businesses.

In the week before President Donald Trump's inauguration, the FDA announced that Zyn, the nicotine pouch, would be allowed to stay on the market. Motley Fool host Mary Long talks with analyst Nick Sciple about what regulatory changes mean for big tobacco's "smoke-free" future.

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A full transcript follows the video.

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This video was recorded on Feb. 02, 2025

Dylan Lewis: We're going Global, checking in on trade and AI investments. Motley Fool Money starts now. I'm Dylan Lewis, and I'm joining over the airwaves by Motley Fool senior analyst Asit Sharma. Asit, thanks for joining me today.

Asit Sharma: Dylan, happy Monday.

Dylan Lewis: As we check the news, it's clear the Trump administration focusing on trade today, catching a lot of headlines, and affecting the markets a little bit. Lots to unpack there. So let's dive right in. Over the weekend, President Trump implementing a 25% additional tariff on imports from Canada, also from Mexico, and then a 10% additional tariff on imports from China. This all tied to the administration's efforts to tighten up border and security work. The market processed this very quickly and swiftly with some red Asit. We saw this hit the major indices, but also companies that are in a lot of the categories you would expect to be affected by tariffs.

Asit Sharma: Yes, Dylan, so it feels a little broad based here, and you see some darker red ink spilled in industries that have more of an impact. Think about the auto industry in the US, companies like GM, obviously, with this supply going through Canada, the United States, Mexico, to build an automobile. That makes a lot of sense. I think you saw also just on a more global basis, that the idea of surprise as you alluded to. Because we've been through this route before with the previous Trump administration, and the sense coming away from that was that tariffs would be implemented a little more gradually and they're also unpredictable when they come from the Trump administration. So just the swiftness and I think the big numbers, the 25% numbers on imports from Canada and Mexico took investors a little bit by surprise. I think took companies by surprise, too, because I didn't see much movement of inventory, people trying to get stuff into the United States before tariffs went into effect, even though the Trump administration had said, Look, it's going to be very soon after Trump assumes office. So we have on many levels, I think investors trying to sort out what this means, as well as businesses trying to understand the implications going forward.

Dylan Lewis: No surprise in some sense. We knew that this was going to be something that was a priority for the administration. It came up quite a bit on the campaign. With this and with a lot of major action, it's always about the timing and how well forecasted that timing is. This is a story that I hope our listeners are not overreacting to because it's a story that's moving and changing quite a bit, even between when we started the show notes for today's episode and we are actually here talking about it now on air. As originally written, the tariffs would have taken effect early Tuesday morning, but the story has moved. Tariffs on Mexico apparently would be paused for a month, as the president there, Claudia Sheinbaum and President Trump were able to agree to terms and a one month suspension on that tariff going into effect, there is massive scope to this Asit. The three companies that are being targeted by this are the largest importers to the United States. I think they make up about 40% of all US imports. We have a little bit of lead time now with processing the Mexico side of this, but the Canada and China side very much a reality at this point. How are you looking at the way that it affects specific companies and industries?

Asit Sharma: So I'm just going through the types of companies that I invest in and trying to understand, are these companies that have a lot of, say, raw materials that are coming into the US? Are their businesses dependent on successful trade? Can they be hurt on the margins. So for example, if you have a company that you're investing in and it doesn't seem that it's going to be that much impacted directly by tariffs, but they're barely profitable and growing. Sometimes that can be the difference that much of tariffs for China so 10%. Let's focus on a Canadian company that is Canadian or Mexican. The impacts of 25% can really be hard when you have consumers who are the ones who actually paying more. That's how the economic situation works. So there are companies that seem that maybe they won't have a very significant impact, but they will, and the opposite is true. To that companies also plan for this. They can manage inventory, manage costs. If it sounds like I'm hedging here, Dylan, it's because I am. As you know, these things play out over time, and I know we're going to talk about one company in particular in a few minutes, a railroad company. We'll return to this. I want to really zone in on some comments the CEO of this company made to put this all in perspective.

Dylan Lewis: Let's dive into that company. Asit, I know you follow Canada Pacific, Kansas City. They're a cross border railroad company. They operate in Canada, the United States, and Mexico. Probably, I would think one of the companies most tangibly affected by all of this. What was the management outlook?

Asit Sharma: So management was asked about this just a few days ago when the company released earnings, and the CEO said what you would want to hear if you're a shareholder. He said, Look, we have been investing in Railyards to service this whole North American supply chain. For those of you who don't know, Kansas City Southern US Road merged with Canadian Pacific. This is now almost two years ago to form the single railroad that has the ability to carry goods across borders from Mexico all the way up into Canada. So again, if you think the automotive industry, it's very important there. He talked about the fact that they can't really slow down investment because of tariffs that might come down the road. They're going to invest more than 48 months at a time. So for a company like this, they know they're going to take some hits, but again, it's at the margins. We look back at what happened the last time we had these multinational tariffs, and they survived, and they're going to survive, too.

But for a company like this, there is an impact on their business because as trade slows business down, that means their volumes are going to decrease. Hence, that stock is down about 6% this morning. That's what I mean about trying to understand things on the margins. We can't do it overnight. It's going to take several quarters to play out. We'll be listening to earnings calls. From CEOs who are discussing the exact impacts on their business levels. I think there's still some more room for negotiation here. We know that President Trump often will go to his most extreme position in order to bring out a concession, and that seems to be the case.

As you said, this story has so many moving parts. As of this morning, there's a one month reprieve for Mexico, and let's see what our neighbors to the North come up with. Maybe they will also have something that will be able to bring them a concession out from President Trump and the Trump administration side. So not to get too worried over all this if you're an investor. That's my main takeaway here but it is something that now is one more thing to watch with so many others in 2025, from two years of great market performance, maybe that's not the case this year to deep seek stories we've been talking about how AI is changing. Just one more thing to keep up with.

Dylan Lewis: There's quite a basket for investors in 2025. One of the other areas that I want to zoom in on this story with, I did not think that I was going to be brushing off my high school Latin when we recorded today's show, but there's a lane here that impacts a very specific part of trade exemption, and that is the de minimis rule. We're going to get a little bit wonky here for a second. But this is a trade exemption that allows for packages below $800 to enter the US duty free, and that has been one of the main things that the Trump administration has targeted with these series of tariffs. In particular, Asit, it feels like this is something that is going after a lot of the goods that are coming in from China, particularly from some of the discount online retailers in that country.

Asit Sharma: That's true, Dylan. You had noted to me that the US had more than 1.3 billion shipments that were processed under the de minimis rule last year, and how that's up exponentially from 139 million annually as of 2015. So what is going on here? We've all seen some of these business models. It's hard to escape ads from some of the businesses like Temu. I think this is the nexus of a lot of manufacturing capacity that we've seen come out of China, the ability to spring up businesses overnight and the ability to have flexible manufacturing so that I, as a business, can use many digital ads and have algorithms, tell me which ads are trending. As I'm working my production up, I'm also dialing other products down. So that's the way they can do it and make money because you would think, how can someone sell something for three bucks to hundreds of thousands of people and make money on it?

It's because they wind that down after a few days based on all the data that they're taking. This is something that wasn't really possible for all the decades that the de minimis rule existed and I think in the last decade or so, it's become very possible with the technology we have today. But it is a wide loophole that's allowed low cost competitors to come in from overseas and take business from companies whose domain has been to move goods here in the US, like amazon.com. So I think there's definitely this one has a political undercurrent. It's one that some big businesses in the US don't mind at all, that this is part of the package today. The de minimis rule is getting clamped down.

Dylan Lewis: You brought up the element of surprise here for business owners, and one of the things we come back to on the show quite a bit, is this idea that markets generally like certainty and that there are always these adjustment periods, when there's seemingly large new information to process. That is certainly true of investing and the stock market, but it's also very true of trade markets and people who operate businesses, buyers and sellers, looking for things like stability and availability when it comes to goods. We knew that this was on the horizon, we knew this was happening. Now we have a little bit of a better sense on the timing and implementation of it. We're midway through earnings, and so I think we'll probably have the opportunity for some management teams to weigh in on their conference calls about this thing. But do you think we'll see anything interesting with how companies are trying to balance inventory levels or major orders or anything like that over the course of the next year or so, trying to work some of this in and forecast out what the future might actually look like.

Asit Sharma: I think we will, Dylan. I think you're going to see a surge of references to raw material costs, supply costs, cost optimization, everything to do with cost. Why? Well, if you're a manufacturer, this doesn't just mean that the end product is going to be charged out higher to your customer. All the components that you take in, if they're part of the North American free trade route. This used to be NAFTA. It's now under something called the United States Mexico Canada Act, the USMCA. All of that is potentially subject to higher cost for you if you're bringing in components to build an end product. So this becomes very complex the last time this happened. Just as you said, Dylan, over the course of quarters, we saw management teams starting to dissect what parts of their supply chains were most affected, communicate that out to investors and give their plan for how they were going to manage their levels of component supply. But as for overall inventory levels, it has a dampening effect. It means that you're probably going to be a little more careful with what you stock and try to go more just in time. If you are a manufacturer that previously because of COVID didn't want to have those shocks, so you had more inventory on hand in case something happened again. Now we're going to go the other way. I think, yeah, inventory is such an interesting part of this whole story to watch going forward. We're going to hear a lot of talk about inventory in the coming months.

Dylan Lewis: We're going to stick with the Global view here and switch from tariffs to artificial intelligence. OpenAI continues to push further into the partnership game inking deals with some major players. Couple announcements out this week related to its ties with Japanese firm SoftBank. Asit, SoftBank is committing three billion in annual spend to access OpenAI's tech. They are also the new joint venture partners in SB OpenAI Japan, not exactly the catchiest name, but a sign that Masayoshi Son the leader at SoftBank, very interested in OpenAI's enterprise offering and trying to bring that to Japanese companies. It seems like we are seeing SoftBank, Masayoshi Son, and OpenAI together more. What do you make of that?

Asit Sharma: We are, Dylan, Masayoshi Son is probably the best person on the planet raising capital. I can't identify someone who's able to string together hundreds of billions of bucks, as he has done with his various vision funds. He's also a great hit and miss investor. He's had some very famous hits like investing early in Alibaba, but he also invested in WeWork famously, and that goes so well for him. But I love that you call out the enterprise software and the SB OpenAI Japan venture, because this is also classic Masayoshi Son that most people don't know about. Masayoshi Son loves to study American technology trends, catch them when they're relatively early, buy them, license them, and transplant them over to Japan. Thus, Morningstar, which is a well known financial services firm in the US, supplying data to so many people. E*Trade, another entity that most people know here in the US, those were both investments of Masayoshi Son, and then he made them into some of the biggest financial enterprises in Japan under very similar boring names. [laughs] But this is something that he actually is pretty good at, so I'll be following that. To your other question, Masayoshi Son wants to be on the scene. Sam Altman also wants to be a player. So what happens when you put two guys like this together? They want to team up in so many different ways. We're still digesting them being partners in Stargate from last week and a few weeks ago and here's some more teaming up between these two outsized personalities.

Dylan Lewis: It seems like we know that there are very large costs associated with Cloud computing and these AI workloads. It seems like Sam Altman is making a lot of very deep pocketed friends. He has his Microsoft gang. He is now appealing to the largest, probably best known investor in Japan for funding, and in very typical Masayoshi Son fashion. They have this joint venture in place, but SoftBank is reportedly going to be one of the leads of the OpenAI funding round that is coming up, which would by some reports, double valuation from where it was in late 2024. We have seen him run that playbook before. When he is in on an idea, Asit, he is all in on an idea. [laughs]

Asit Sharma: Totally. I think for Sam Altman, too, he is learning from his illustrious predecessors.

Asit Sharma: Think back to Steve Jobs coming back to Apple and realizing they needed capital and getting arch enemy Microsoft to be an investor, think Elon Musk, who understands that you can be as good as you are in business or building things, but you maybe have to have a supreme talent of raising capital if you want to be this dominant global company. Entrepreneurs like this have shown what the mold looks like if you're trying to dominate an industry. I think Sam Altman really recognizes the need for partnerships for raising lots of money, for being like a salesman, even as he's trying to, from his perspective, change the world with artificial intelligence. Of course, there's so many other players. He gets a lot of attention in the limelight. For that, I think doors open for him, but this is a practiced strategy. It's not by chance that Sam Altman is such an evangelist for the industry and for opening eye.

Dylan Lewis: Asit Sharma we'll cut it there. Thanks for joining me today.

Asit Sharma: Thanks so much for having me too.

Dylan Lewis: Listeners, if you want more on SoftBank and Masa Son's investing MO, check out this weekend's Motley Fool Money episode. My colleague Ricky Mulvey talked with the man that literally wrote the book on Masa Son's vision for the world and his approach in technology. That's former Financial Times editor and chief Lionel Barber. Coming up next on the show, stick with the theme of policy changes that affect companies. In the week before Trump's inauguration, the FDA announced that ZYN, the viral nicotine pouch, would be allowed to stay on the market. Up next, Mary Long talks with pool analyst Nick Sciple about what these regulatory changes mean for Big Tobacco's smoke free future.

Mary Long: On January 16th, so just keep in mind, pre Trump's inauguration, the FDA cleared ZYN, a nicotine pouch product for those who might be unfamiliar to stay on the market. The agency's argument was that ZYN offers a safer alternative to cigarettes and dipping tobacco. Nick, for the folks who aren't closely following FDA updates, who aren't anxiously awaiting developments on this front, what's the broader story here, and how does this development in regards to nicotine pouches fit into that broader story?

Nick Sciple: Thanks, Mary. Yeah, I think the big takeaway here is this gives us an idea about how nicotine pouches will be regulated. Although these products have been on the market for 5+ years and have been one of the fastest growing consumer products in the world, putting up close to triple digit comp annual growth rates over that period. I really been in limbo with the FDA hadn't yet received approval for their tobacco marketing applications. None of the nicotine pouch products had ZYN, being the market leader with about two thirds of the market, getting authorization here says the FDA is going to authorize these products. We're not going to shut down these products like you had seen in the past. With vaping and the really important thing is the FDA determined that the product shows it has more public health benefits than it does risks, particularly to youth out there. The big determinations were that because ZYN has substantially lower amounts of harmful constituents in it than cigarettes and other smokeless tobacco products, it poses a lower risk of cancer and other serious health risks than those other nicotine products.

Also, Philip Morris showed evidence that most of the folks who switched to these nicotine pouches from smoking or other forms of tobacco use end up remaining on these products over the long term. This is a safer product that gets folks to stop smoking and start using a safer product. At the same time, as we saw with chew in the past and other these vaping products, there's lots of concern about increasing youth dependence on nicotine. The FDA reviewed data related to that and found that usage of nicotine pouches, despite this really rapid growth we've seen in the industry remains very small. They cited the 2024 National Youth tobacco survey, that just 1.8% of US middle school and high school students are currently using nicotine pouches. We get an idea today of what the regulatory environment is going to look like for pouches that they're going to remain on the market for quite a long time, and when you've got a product that's expected to grow at a 30% compound annual growth rate over the next five years, certainly a place worth watching.

Mary Long: You mentioned that rapid growth that's already happened and that's expected to continue. ZYN has been available in the US since 2014, was acquired by Philip Morris in 2022, that acquisition allowed ZYN to expand its distribution, but its rise in popularity is also due in part to ZYN influencers, who are content creators who post a lot about ZYN, and that have really made this product go viral. There was a ZYN shortage earlier in the year, in part due to this. What is it about ZYN that led to its virality?

Nick Sciple: I think the big thing is, this is the first product to market, and it's the best product on the market. It's not going to surprise anybody here saying nicotine is super popular. There's 28 million adult smokers in the US, and a lot of those folks would like to stop smoking. ZYN is a product that, as I just said previously, it helps folks do that, and it's consistently been the highest quality product on the market. Many of its competitors often have a lot of loose powder, broken pouches in the can. It's just a lower quality experience. If you think about branded consumer products as a whole in particular, particularly in tobacco and nicotine, for whatever reason, people build super high affinity with these products. I think that's what you're seeing with these influencers emerging. You have a super appealing product that has led to super engaged users, but pouches still really have a lot of room to grow. ZYN has sold 460 million cans through the first nine months of 2024 up 55% year over year, and that's in spite of those supply shortages. As you talked about, that sounds like a lot. We had 7.6 billion packs of cigarettes sold in the US in 2023 alone. I think a good chunk of those folks are going to become users of ZYN and these nicotine pouch products over the long term. I think public health will benefit from that.

Mary Long: To be clear, ZYN influencers are not paid by ZYN. They do it for free, and I think that leads to an interesting business situation here because on the one hand, what business does not want free advertising. That's a seemingly sweet deal for a company. But at the same time you talk about ZYN does not want to be marketing to young children. That's bad for their branding. That's bad for public health. When ZYN does not pay as influencers, they lose control over who advertises the product, how they advertise it, and of course, who they advertise it to. What problems does Philip Morris zooming out face when it loses control over this free social media driven advertising?

Nick Sciple: Well, I don't know if they ever had control over it. ZYN wasn't paying these folks today, as I understand it. Otherwise, probably would have the FDA would have not been very happy about that. As I understand it, the FDA is not going to be able to restrict people's ability to talk about the brands they consume and that sort of thing. But this does restrict how Philip Morris can affirmatively advertise their products, and there are some restrictions here. FDA is going to impose "stringent marketing restrictions for digital TV and radio advertising," including measures to ensure ads are carefully targeted to adults 21 and older, also requiring them to only use models that are 45 years or older. I think this is something that Philip Morris said they would sells only use models that are over 35. They're not going to advertise on radio or TV. I think these sorts of things limit the ability to advertise as consumer product, which is not positive. However, at the end of the day, regulation is the friend of the incumbent. Regulation is the friend of the participant that already has the market.

If ZYN already has 70% market share in this business, and it's the word at the tip of everybody's tongue for another product to enter this market and disrupt that share of mind, you really would like to be able to advertise. What this is saying now is that nobody's going to be able to advertise, which is exactly the regime we're currently in with cigarettes. I think if we want to draw forward that the regulatory regime for nicotine pouches is going to look similar to cigarettes, then you're going to entrench the same few participants in the market as you see today and the earnings profile should stay appealing, which is part of what's interesting here. Is the public health benefit of these products coming out here on the market, lots of growth there. From a business perspective, these products remain incredibly profitable and the market structure looks like it's going to stay in the same three or four buckets that it already is.

Mary Long: We kicked off this conversation by highlighting an FDA regulation. There was another one that came out the day before that's now faced some changes on January 15th. Again, prior to Trump's inauguration, Biden's FDA proposed a rule to make cigarettes minimally or non addictive by limiting the level of nicotine in them. Shortly into Trump's new term, the FDA moved this rule proposal to long term action, basically meaning it won't be moving forward with this change anytime soon. We talk a lot about the importance of knowing the companies that you're investing in, really understanding them before making a purchase and buying into them. But it's also really important to understand the landscape that that company operates in, especially if a company's success is so closely tied to regulation. What do investors need to know or keep in mind before investing in a highly regulated industry, even if it's not the tobacco industry?

Nick Sciple: Yeah, I think what I said earlier is important. Regulation is the friend of the incumbent. It makes barriers to entry that much higher as competitors not only have to jump into the business and compete with you on those terms, but have to navigate the morass of regulation. Also, you talk about, how does somebody who's a new entrant to this market plan for these types of changes? One day you're taking into account the potential for a change in the market to lower the amount of nicotine in cigarettes. There was another rule that was pulled that would have banned menthol cigarettes from the market, which is really significant source of profit for folks like British American Tobacco and others? I think the uncertainty that regulation injects the industry, again, just limits the number of people that are even interested in participating in it, which as I said earlier, benefits the incumbents in the industry.

Mary Long: We've seen that uncertainty and the back and forth and regulations play out before. You mentioned Jewel earlier in our conversation. The FDA had ordered the company to stop selling its products in 2022, they stayed on the shelves due to an appeal then in June 2023, the FDA reversed its initial ban. Altria paid $13 billion, not even for all of Jewel, but for 35% of it in 2018. What's happened to that investment since Nick?

Nick Sciple: Pun intended went up in smoke. It's basically gone nowhere. Back in 2023, Altria basically gave Jewel away, exchanged its minority stake in Jewel for some intellectual property rights around inhaled tobacco. They also turned around and bought Enjoy as their vaping play, I think the lesson of Jewel is investing in a product that has regulatory risks, hanging over it really is not a good idea in the nicotine industry. Then the big experience, for Jewel, that got them into trouble is they were directly advertising to youth. That is something that will blow up your business very, very quickly. That's part of what you really have seen the nicotine pouch folks try to stay away from as much as they possibly can, even adding voluntary restrictions to themselves on top of what the FDA is requiring.

Mary Long: Lots of big tobacco companies are increasingly looking toward moving beyond smoking. Pouches are a part of that, dates are a part of that. Any of these newer ventures actually playing out for those? We just talked about the back and forth with Jewel, but that didn't really work out so well. Are any of these new ventures proving successful this far?

Nick Sciple: Well, everybody is seeing really rapid growth in nicotine pouches, vaping, things like that. But as far as making a real dent in the overall earnings base of the company, Philip Morris is by far the leader there through the first nine months of 2024, generated 37% of its revenue from smoke free products, and they own the leading products in that market. I mentioned ZYN the leading pouch product in the US. They also are a leader in heat not burn products, which are much more popular in Europe and Japan through their ICOs brand by 2030, Philip Morris has said it plans to get two thirds of its revenue from smoke free products. The market has really rewarded Philip Morris for its investments in these products up more than 50% over the past five years, you compare that to companies like British American Tobacco and Altria, which are down or really have barely moved before dividends over that period. Philip Morris, the market also gives them a much higher multiple. They're trading at close to 20 times earnings as opposed to those other big tobacco companies that are trading at a single digit multiple. I think the takeaway is that there are companies that are doing it and the market's rewarding them for it. I think that's going to continue to happen as we go forward.

Mary Long: There's a lot of headwinds facing this industry. We've talked about the regulation that can make it difficult and tough to predict what the next big thing is going to be and how that's going to play out. Smoking also continues to decline in the US. Depending on the success of these newer smokeless ventures that we've discussed already, what other options do companies like Philip Morris and Altria have beyond those?

Nick Sciple: Well, they certainly make a lot of profits every year and they could reinvest them in other places. You saw Philip Morris dip their toe into healthcare a couple years ago. But folks seeing Philip Morris attached to healthcare, a lot of controversy there. They ended up having to divest. If you want to zoom out further in the '80s, you had RJ Reynolds own Nabisco. There were these big conglomerates. You could potentially see that happening. I'll tell you, as someone who is interested in investing in this nicotine pouch trend, I would hate to see that because some of the most profitable businesses of all time, I've been these nicotine businesses and people have been using nicotine since prehistory.

When Columbus stepped off the boat, he saw people smoking tobacco. I don't think tobacco is going to go away anytime soon. I think it's going to change consumption forms just as it has in the past, gone from pipes to cigarettes to today. I think we're moving to these nicotine pouches. Nicotine has been one of the best foreign businesses of all time because of the brand power that you see in these consumer products, but also because of the regulation that you see in the industry. As I said before, I think you're going to see a similar regulatory regime going forward. I think these businesses are going to have success in these smokeless ventures, and I think there are companies that should consider investing in.

Mary Long: Nick Sciple always a pleasure to have you on. Thanks so much for taking the time to walk us through these FDA regulations, even when they go back and forth, and they change last minute as administrations change, appreciate having you on the show.

Nick Sciple: Anytime, Mary.

Dylan Lewis: As always, people on the program may have interest in the stocks they talk about, and Motley Fool may have formal recommendations for or against, so don't buy or sell anything based solely on what you hear. All personal finance content follows Motley Fool editorial standards. Is not approved by advertisers. Motley Fool only picks products it personally recommend to friends like you. I'm Dylan Lewis signing off. Thanks for listening. We'll be back tomorrow.

Asit Sharma has positions in Canadian Pacific Kansas City and Microsoft. Dylan Lewis has no position in any of the stocks mentioned. Mary Long has no position in any of the stocks mentioned. Nick Sciple has positions in British American Tobacco and Philip Morris International. The Motley Fool has positions in and recommends Apple, Canadian Pacific Kansas City, and Microsoft. The Motley Fool recommends Alibaba Group, British American Tobacco P.l.c., General Motors, and Philip Morris International and recommends the following options: long January 2026 $395 calls on Microsoft, long January 2026 $40 calls on British American Tobacco, short January 2026 $40 puts on British American Tobacco, and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.